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United Airlines posted its highest second-quarter revenue and had its first profitable quarter since the start of the Covid-19 pandemic, the company said on Wednesday.
The Chicago-based airline, the second largest in the US, reported net income of $329 million on operating income of $12.1 billion. Revenue was up 6% compared to the March-June 2019 quarter, while flying with 15% less seat capacity.
Earnings per share were $1.43, below analysts’ estimates of $1.95 per share, according to a survey by Refinitiv.
Summer air travel plunged into chaos in May and June as airline operations struggled to ramp up to meet the surge in pent-up demand created by the Covid-19 pandemic. More than 34,000 United flights to, out of or within the US were canceled or delayed, the equivalent of a quarter of its entire schedule during those two months, according to flight tracker FlightAware.
“It’s nice to return to profitability, but we have to face three risks that could grow over the next six to 18 months,” said CEO Scott Kirby, referring to the “industry-wide operational challenges that they limit system capacity, record fuel prices and the growing possibility of a global recession”.
Ed Bastian, chief executive of rival Delta Air Lines, told the Financial Times last week that he was not worried about the impact of a possible recession on the airline industry.
United spent roughly $4.18 per gallon of fuel, consuming 912 million gallons in the second quarter. The airline expects fuel prices to moderate in the third quarter to $3.81 a gallon.
The carrier also forecast third-quarter revenue to rise 11% from the same period in 2019, when it reached $11.4 billion. United also reiterated its expectations for a profitable full year.